The Evolution of Serbian Forex Through NBS FX Swaps
This paper emphasizes the main goals of using derivatives as a monetary tool, increasing the foreign currency liquidity of commercial banks and controlling the volatility of the national currency. Over the past few years, FX swaps, very often mistaken for currency swaps, became a popular monetary instrument among central banks. Since 2007, inter-central bank swap credit lines have become a role model for supporting the foreign currency liquidity of national commercial banks. The National Bank of Serbia introduced FX swap transactions as part of a special facility for supporting the country’s financial stability. Our research indicates that the NBS is not part of a swap credit line, but rather uses FX swaps internally and in a very fragmented manner. The trading volume of the newly-introduced instrument has been quite modest. The quiet introduction of FX swaps has failed to make any insignificant impact on the stabilization of the national currency, and has caused a fairly minor increase in EUR liquidity. At the very end it is worth mentioning that, regardless of the first results, NBS swaps mean that the Serbian forex derivative market has “crossed the Rubicon”.
Volume (Year): 45 (2012)
Issue (Month): 3-4 ()
|Contact details of provider:|| Postal: 12 Zmaj Jovina St, 11000 Belgrade, Serbia|
Phone: +381 11 2622 357, 2623-055
Fax: +381 11 2181 471
Web page: http://www.ien.bg.ac.rs
More information through EDIRC
When requesting a correction, please mention this item's handle: RePEc:ibg:eajour:v:45:y:2012:i:3-4:p:14-30. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Zorica Bozic)
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.